Script for audio podcast:
Internal Controls and Management Actions Concerning John C. Beale’s Travel (Report #14-P-0037)
[Ashley Sellers-Hansen] I am Ashley Sellers-Hansen with the Environmental Protection Agency’s Office of Inspector General, speaking with auditor Vanessa Rodriguez-Moya about travel abuse at the EPA. Our Office of Audit recently issued an early warning report regarding the agency’s internal controls and management actions.
[Ashley Sellers-Hansen] Vanessa, why did your team do this review?
[Vanessa Rodriguez-Moya] On August 27, 2013, the Ranking Member of the Senate Committee on Environment and Public Works requested that the EPA Office of Inspector General look at broader issues surrounding the fraud committed by John Beale, a former employee within the EPA’s Office of Air and Radiation. In particular, the Ranking Member requested that the OIG determine the policies and procedures that facilitated Mr. Beale’s fraud.
[Ashley Sellers-Hansen] What did your team look at, specifically?
[Vanessa Rodriguez-Moya] We reviewed all of Mr. Beale’s travel vouchers from 2003 until 2011, which included 45 planned trips.
[Ashley Sellers-Hansen] What were your findings?
[Vanessa Rodriguez-Moya] We found that a lack of management oversight and weak internal controls at the agency facilitated Mr. Beale's travel abuse in the following four areas:
• 1. Excessive premium class travel.
• 2. Claiming actual expenses above the per diem amount.
• 3. Fraudulent and questionable travel.
• And finally, unnecessary transportation costs.
[Ashley Sellers-Hansen] Can you provide examples of the travel abuse committed by Mr. Beale?
[Vanessa Rodriguez-Moya] Yes. Our audit team found that:
• While Mr. Beale was authorized to use business class for air travel due to a medical reason, he flew first class roughly 70 percent of the time.
• Additionally, 52 percent of his lodging expenses were approved even though the rates were above the per diem amount. For example, during a trip to London in 2008, Mr. Beale’s lodging expenses exceeded the per diem amount by 550 dollars per night.
• Furthermore, Mr. Beale claimed over 45,000 dollars for six trips to Los Angeles for work but actually just visited family in Bakersfield, California.
• Finally, during a trip to London in 2008, John Beale claimed that he had taken five taxi rides that cost a total of about 250 dollars and, on the same day, used a chauffeur service costing 310 dollars. No explanation was provided on his travel voucher for these charges.
[Ashley Sellers-Hansen] How did this fraud go unnoticed until now?
[Vanessa Rodriguez-Moya] Specifically, we found that:
• Reviews of vouchers or receipts were limited.
• Questions raised by personnel who reviewed Mr. Beale’s travel were dismissed by EPA management.
• Further, Mr. Beale’s reviewing official, as a peer, did not question his travel. In fact, during an interview, that same reviewing official stated – quote –“It is hard to question Beale's behavior and travel expenses when it was supported by another senior executive.”
[Ashley Sellers-Hansen] What is the agency doing to correct the issues presented in this early warning report?
[Vanessa Rodriguez-Moya] The EPA’s Office of the Chief Financial Officer already has identified internal control improvements to prevent or detect travel related issues:
• For example, an employee’s eligibility for premium-class travel based on a medical reason now must be made by the agency’s Office of Reasonable Accommodation.
• Also, the agency soon will require second line supervisors to approve an employee’s lodging for any amount that exceeds a designated percentage over per diem, and require Senior Resource Official approval of any single trip exceeding 5,000 dollars.
• Lastly, the agency has committed to a complete internal control assessment by February 2014 for travel in the areas of:
o Premium class travel.
o Above government rate travel reimbursement. and
o Executive travel approvals.
[Ashley Sellers-Hansen] Will there be additional audit reports regarding other areas of fraud pertaining to John Beale?
[Vanessa Rodriguez-Moya] The public can look for more in-depth reports on EPA wide travel, specifically covering Executive Level travel, trips by frequent travelers, travel costs over 5,000 dollars and the length of time it took travelers to submit vouchers.
[Ashley Sellers-Hansen] Thank you Vanessa, for sharing the results of this valuable work. For more information about this report and other OIG activities, please visit our website at www-DOT-epa-DOT-gov-FORWARD SLASH-oig and be sure to follow us on Twitter. The hashtag is AT-epaoig.